The Leesburg Smart Grid: The Genesis of a Solution

But what could be done? As a member of the FMPA, Leesburg’s electric utility is forbidden from installing any of its own generation assets to offset its load. In addition, because of the structure of the long-term contracts, seeking new, cheaper sources of electricity was also out of the question. Alas, the best and only way to drive down costs was to reduce electricity use during the timeframe when the FMPA was calculating its peak demand each month. All that was needed was a means to execute this.

After an exhaustive analysis of electricity usage patterns over the past few years, Kalv built his own model of electricity demand for Leesburg. Becoming an electricity soothsayer of sorts, he got better and better at forecasting when Leesburg would reach its peak demand each month as well as when FMPA would determine the system-wide peak demand. Armed with this information, he had the answer to one of the two questions he needed to answer — when to reduce electricity usage — but what remained to be illuminated was the how.

The concept was first tested with a low-risk/low-reward strategy by implementing conservation voltage reduction during the hours of the month that could be a potential peak hour; the utility saved just over $34,000 by reducing the demand 1.7 megawatts (MW.) After achieving savings of more than $200,000 by reducing demand during five of the first six months the trial was in effect, Leesburg’s team was ready to expand the project.

Kalv knew that a number of his larger electric customers had back-up generation onsite. As with all backup generation, the systems are only as good as the regular maintenance and testing regimen in place. And Leesburg had eight of its own emergency generators located at critical municipal infrastructure locations, including water and wastewater plants, the electric operations center, police station and City Hall.

Kalv identified two large electric customers that had backup generators: a popular supermarket chain and the Leesburg Regional Medical Center (LRMC). He contemplated the potential of these two customers, together with the eight Leesburg generators, scheduling the exercising of their generators during the hours believed to be a potential peak hour, generally 5 to 10 hours per month. Thus, Kalv’s demand response program was born.

Kalv met with supermarket and LRMC representatives and offered to share the savings accrued by avoiding the demand charge, and they agreed to execute his demand response idea. As a result, the total demand for Leesburg was reduced in the process.

“We saw obvious dollars to be saved for us as well as the community,” said David Taylor, operations manager for Central Florida Health Alliance, which oversees LRMC.

“2004 and 2005 were active hurricane years in Florida and we have over 700 locations,” said the energy manager of the supermarket chain. “During that time, we threw away tens of millions of dollars worth of product due to hurricanes. In an attempt to resolve this problem, we looked to partner with utilities and I was very excited when Paul approached me about doing this on a municipal level.”

It was apparent that Kalv identified the solution that the energy manager was looking for. After determining the initial success of the pilot demand response program, Kalv expanded the program offering other businesses a 50/50 split of Leesburg’s wholesale demand cost savings.